Question Paper

Introduction to Management - II (MB112) : October 2006

• Answer all questions.
• Each question carries one mark.

1. The most important resources of an organization are its employees - the people who work in the organization and give < Answer >
it their talent, creativity and drive. Employees are vital for effective operation of a company. Which of the following
is/are true about organizationally committed and satisfied employees?
(a) Lower rates of turnover and absenteeism
(b) Higher rates of voluntary turnover
(c) Higher rates of absenteeism
(d) Low motivation
(e) Early voluntary retirement.
2. When a manager asks his assistant manager to provide feedback about the job performance of the individual < Answer >
subordinate working under him in writing, it is called
(a) Role perception
(b) Informal appraisal
(c) Formal appraisal
(d) Performance appraisal
(e) Role conflict.
3. A responsibility center is a sub-unit headed by a manager who is responsible for achieving one or more goals. Which < Answer >
of the following statements is/are true of responsibility centers?
I. An organizations choice of responsibility centers depends to a great extent on its control mechanisms.
II. Sales or marketing units may be considered as revenue centers.
III. Organizations that have a divisional structure may opt for profit centers.
IV. Autonomous businesses may be considered as investment centers.
(a) Only (I) above
(b) Only (IV) above
(c) Both (II) and (III) above
(d) (II), (III), and (IV) above
(e) All (I), (II), (III) and (IV) above.
4. ‘Management Information System’ (MIS) helps the manager to discharge his/her managerial functions in a more < Answer >
efficient manner. The first necessary step to effectively operate an MIS is
(a) Summarizing data
(b) Analyzing data
(c) Determining information needs
(d) Gathering appropriate information
(e) Generating reports from gathered data.
5. Which model of leadership behavior proposes that a leader should adjust his or her leadership style in accordance with < Answer >
the readiness of followers?
(a) Path-goal theory
(b) Vroom Yetten model
(c) Fiedler’s contingency model
(d) Hersey and Blanchard’s model
(e) Managerial grid.
6. There is a set of motivational techniques available to the managers to improve the productivity and performance of < Answer >
employees. Which one of the following is not a motivational technique?
(a) Reward
(b) Participation
(c) Quality of work life
(d) Job enrichment
(e) Job analysis.
7. Interviewing is an important step in the selection process of an organization. When a manager interviews a job < Answer >
candidate by asking him a list of questions from an outline, it is an example of which type of interview?
(a) Structured
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 (b) Stress
(c) Unstructured
(d) Comprehensive
(e) Semi-structured.
8. An intervention, in Organization Development (OD) terms, is a systematic attempt to correct an organizational < Answer >
deficiency uncovered through diagnosis. Which of the following intervention techniques is concerned with the
interpersonal relations and dynamics operating in work groups?
(a) Technostructural activity
(b) Team building
(c) Skill development
(d) Process consultation
(e) Survey feedback.
9. In which of the following orientations toward international business, does a firm analyze the needs of customers < Answer >
worldwide and then adopts standardized practices for all the markets it serves?
(a) Ethnocentric
(b) Polycentric
(c) Geocentric
(d) Regiocentric
(e) Unicentric.
10. As per Hersey and Blanchard’s leadership model, a leader shows high relationship behavior and high task behavior < Answer >
when
I. Eventually, employees learn to perform their tasks.
II. Employees still need to be guided by leaders.
III. Employees are in the initial phase of readiness.
IV. Employees become more experienced.

(a) Both (I) and (II) above

(b) Both (II) and (III) above
(c) Both (III) and (IV) above
(d) (I), (II) and (III) above
(e) (I), (III) and (IV) above.
11. J. Stacy Adams developed equity theory of motivation while working for the Behavioral Research Service of General < Answer >
Electric. Which of the following is not true about the equity theory?
(a) Perceptions of fairness depend on assessment of inputs
(b) Perceptions of fairness depend on assessment of outcomes
(c) Perception of fairness depends on the behavior and treatment a superior emits towards an employee
(d) Outcomes are rewards such as recognition and pay
(e) Inputs are contributions such as effort and special skills.
12. Every organization makes minor structural adjustments in reaction to changes. Change is any alteration of the "status < Answer >
quo". The forces of change can be internal or external to the organization. An example of an internal force for change
is
(a) Marketplace
(b) Government regulation
(c) Technology
(d) Workforce
(e) Economic change.
13. Which of the following statements is/are true with respect to ‘Discretionary Expense Centers’? < Answer >

I. The output of a discretionary expense center cannot be directly used to produce revenues.
II. Budgets for discretionary expense centers are developed only in terms of maximum resources that can be
consumed by them in a particular period.
III. For assessing the budgetary performance, the expense constraints are established at the discretion of the
manager.
(a) Only (I) above
(b) Only (III) above
(c) Both (I) and (II) above
(d) Both (II) and (III) above
(e) All (I), (II) and (III) above.
14. In Japanese organizations, informal organizations that yield considerable power in formal organizations are referred to < Answer >
as
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 as
(a) Wa
(b) Habatsu
(c) Kaisha
(d) Kacho
(e) Henko.
15. Which of the following is not an example of current assets? < Answer >

(a) Prepaid expenses

(b) Cash and cash equivalents
(c) Marketable securities
(d) Trade payables
(e) Inventory.
16. The manager inventory chart is used in human resource replacement planning. Which of the following is not an < Answer >
advantage of the ‘Manager Inventory Chart’?
(a) It gives an overview of the human resource situation of an organization
(b) It shows the future internal supply of managers by indicating who is likely to be promoted in a year
(c) It shows the position to which a manager may be promoted
(d) Managers who are ready for promotion can be easily identified
(e) Managers who do not perform satisfactorily can be identified, and the need for training or replacement is
needed.
17. According to Maslow, a person who is looking for affection, belongingness, acceptance, and friendship is at which < Answer >
need level?
(a) Physiological
(b) Safety
(c) Social
(d) Esteem
(e) Self-actualization.
18. The managerial creative process involves four overlapping phases. What is the sequence of these phases? < Answer >

I. Insight.
II. Intuition.
III. Unconscious scanning.
IV. Logical formulation.

(a) (III), (II), (I) and (IV)

(b) (II), (III), (IV) and (I)
(c) (III), (I), (II) and (IV)
(d) (I), (II), (III) and (IV)
(e) (III), (IV), (II) and (I).
19. Which of the following financial ratios measure the ability of an organization to meet its short-term obligations by< Answer >
using its current assets?
(a) Leverage
(b) Asset management
(c) Debt management
(d) Liquidity
(e) Profitability.
20. In the US style of management, the organizing function generally involves < Answer >

I. Individual responsibility and accountability.

II. Clear and specific decision responsibility.
III. Informal organization structure.
IV. Ambiguity of decision responsibility.
V. Formal, bureaucratic organization structure.

(a) (I), (II) and (III) above

(b) (I), (II) and (IV) above
(c) (I), (II) and (V) above
(d) (II), (III) and (IV) above
(e) (II), (III) and (V) above.

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21. According to Fiedler, which of the following is a technique that measures whether a person is task-oriented or < Answer >
relationship-oriented?
(a) Least-preferred coworker questionnaire
(b) Most-preferred coworker questionnaire
(c) Least-preferred subordinate questionnaire
(d) Production orientation
(e) Employee orientation.
22. The basic elements of communication are < Answer >

(a) Source/encoder, signal, decoder/destination

(b) Sender/message, encoder, receiver/decoder
(c) Signal, source/sender, decoder/destination
(d) Signal, source/decoder, encoder/destination
(e) Source/sender, signal, receiver/destination.
23. Herzberg, a behavioral studies scientist, propounded the two-factor theory of motivation. This theory consists of < Answer >
motivators and
(a) Working conditions
(b) Safety factors
(c) Power factors
(d) Hygiene factors
(e) Recognition factors.
24. Which of the following statements is/are true about ‘Economic Order Quantity’ (EOQ)? < Answer >

I. It is helpful for determining desirable inventory levels when demand is predictable.

II. EOQ is useful in determining inventory levels of parts and materials used in production, as well.
III. Decisions based on EOQ could lead to shortage or excess of inventory.
(a) Only (II) above
(b) Only (III) above
(c) Both (I) and (II) above
(d) Both (I) and (III) above
(e) All (I), (II) and (III) above.
25. Kurt Lewin, a researcher at the University of Iowa, and his colleagues, proposed three leadership styles. viz., < Answer >
autocratic, democratic and laissez-faire. Which of the following statements is not true regarding these three
leadership styles?
(a) A democratic leader actively tries to solicit the input of subordinates.
(b) A laissez-faire leader avoids making decisions
(c) An autocratic leader will always have low performance from employees
(d) A democratic leader usually requires a consensus before reaching a decision
(e) Autocratic leaders make decisions on their own.
26. In a PERT network, the sequence of events and activities requiring the longest period of time to complete is < Answer >

(a) Called the network

(b) Indicated by thin arrows
(c) The path that managers avoid
(d) The critical path
(e) Eliminated from the rest of the project so that the project will not take too long.
27. JIT (Just-In-Time) inventory control is an approach to inventory control that stresses on having materials arrive just < Answer >
when they are required in the production process. Which of the following does not apply to a Just-In-Time (JIT)
system?
(a) Suppliers need to be located in close proximity
(b) Organization must have ISO 9001 certification
(c) Reliable transportation facilities should be available
(d) Suppliers need to be capable of providing high quality materials
(e) Long-term relationships should be maintained with the suppliers.
28. Which of the following ratios when high increases an organization’s profitability resulting in a lesser need for < Answer >
investment in assets?
(a) Current
(b) Activity
(c) Liquidity
(d) Profitability
(e) Quick.
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29. Which of the following strategies of overcoming resistance to change involves selectively providing information < Answer >
about a change so that it appears more attractive or necessary to potential resisters?
(a) Cooptation
(b) Manipulation
(c) Coercion
(d) Negotiation
(e) Participation.
30. In order to reduce the subjective interpretation inherent in graphic rating scales, performance appraisal experts have < Answer >
developed
(a) Formal appraisal
(b) Informal appraisal
(c) Standard appraisal
(d) Behaviorally anchored rating scales
(e) 360-degree appraisal.
31. Which of the statements is/are false with respect to element(s) of the motivation process? < Answer >

I. Need is the origin of any motivated behavior.

II. Goals are directed at fulfillment of needs.
III. Drives are action oriented and provide thrust to reaching a goal.

(a) Only (I) above

(b) Only (II) above
(c) Only (III) above
(d) Both (I) and (II) above
(e) Both (II) and (III) above.
32. The labor productivity index is also referred to as < Answer >

(a) Output per labor unit ratio

(b) Output per work-hour ratio
(c) Output per work-day ratio
(d) Input per work-hour ratio
(e) Input per work-day ratio.
33. Managers must develop methods of measurement to signal when deviations from standards are occurring so that < Answer >

(a) The plan can be abandoned

(b) Quality control personnel can be notified
(c) The measurement standards can be checked
(d) Corrective action can be taken
(e) Care can be taken in future.
34. Which of the following can be used in training high-potential employees to become effective leaders? < Answer >

I. 360 degree feedback.

II. Organization culture workshops.
III. List of dos and don’ts.
IV. Community empathy.
(a) Only (II) above
(b) Both (I) and (III) above
(c) Both (II) and (IV) above
(d) (I), (II) and (IV) above
(e) (I), (III) and (IV) above.
35. Which of the following points pertains to ‘Synectics’, which is a technique to enhance creativity in organizations? < Answer >

I. The leader of the group plays a key role.

II. Members are involved in a complex set of interactions that give rise to a solution.
III. The emphasis is on generating as many ideas as possible.
IV. The leader guides the discussion without revealing the problem so that members are prevented from reaching a
premature solution.
(a) Both (I) and (III) above
(b) Both (I) and (IV) above
(c) Both (II) and (III) above
(d) (I), (II) and (IV) above

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 (e) All (I), (II), (III) and (IV) above.
36. People who work in multinational corporations are generally categorized as < Answer >

I. Expatriates.
II. Third country nationals.
III. Host country nationals.
(a) Only (I) above
(b) Only (II) above
(c) Only (III) above
(d) Both (I) and (III) above
(e) All (I), (II) and (III) above.
37. The stage of Kurt Lewin’s change model, which involves preparing employees to accept change is < Answer >

(a) Refreezing
(b) Changing
(c) Unfreezing
(d) Benchmarking
(e) Moving.
38. Of the various leadership styles suggested by the path-goal theory, which of the following statements is/are true about < Answer >
‘Supportive Leadership’?
I. It involves creating a pleasant organizational climate.
II. It involves providing clear guidelines to subordinates.
III. It shows concern for subordinates.
IV. It corresponds to task-centered leadership described in other leadership theories.
(a) Only (II) above
(b) Both (I) and (III) above
(c) Both (II) and (IV) above
(d) (I), (II) and (III) above
(e) (I), (III) and (IV) above.
39. Which of the following involves overseeing the transformation process that converts resources such as labor and raw < Answer >
materials into finished goods and services?
(a) Simulation
(b) Organizing
(c) Operations Management
(d) Linear programming
(e) Inventory management.
40. Hazard analysis and Critical Control Point Method (HACCP) is used in the food manufacturing industry to identify< Answer >
and prevent microbial and other germs from causing harm to food. Which of the following principles involves
identification of preventive measures the manufacturing units can adopt, to control food safety hazards that arise
during processing?
(a) Hazard analysis
(b) Identifying control points
(c) Critical limits
(d) Establish corrective actions
(e) Establishing procedures to ensure correct working.
41. Which of the following is/are example(s) of feedforward control? < Answer >

I. Quality control inspections.

II. Procedures.
III. Policies.
IV. Budgets.
V. Balance sheets.
(a) Both (I) and (IV) above
(b) Both (II) and (III) above
(c) (I), (IV) and (V) above
(d) (II), (III) and (IV) above
(e) All (I), (II), (III), (IV) and (V) above.
42. Which of the following is/are inference(s) drawn from the Ohio State studies? < Answer >

I. The dimension ‘initiating structure’ is similar to the job centered leader behavior identified by Iowa studies.
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 II. The dimension ‘consideration’ emphasizes people related issues.
III. Ohio State studies consider initiating structure and consideration as the two ends of the same continuum.
IV. The two-dimensional approach led to the probability that a leader might place emphasis on both task and people
related issues.
(a) Only (IV) above
(b) Both (I) and (II) above
(c) Both (III) and (IV) above
(d) (I), (II) and (IV) above
(e) All (I), (II), (III) and (IV) above.
43. Assigning workers additional tasks on the same level, which increases the number of tasks they have to do, is known < Answer >
as
(a) Job enrichment
(b) Job enlargement
(c) Job rotation
(d) Vertical job loading
(e) Job loading.
44. Force(s)/trait(s) within the manager that determine(s) effective leadership behavior include(s) his/her < Answer >

I. Values.
II. Confidence in subordinates.
III. Hunger for power.
IV. Aggressiveness.
(a) Only (I) above
(b) Both (I) and (II) above
(c) Both (III) and (IV) above
(d) (I), (II) and (IV) above
(e) All (I), (II), (III) and (IV) above.
45. Which of the following information systems use events as inputs and gives outputs in the forms of detailed reports < Answer >
and lists?
(a) Transaction processing system
(b) Office automation system
(c) Decision support system
(d) Executive support system
(e) Management information system.
46. Raj, Rahul, Ramesh and Rohit all wanted to start their own business after they graduated with their Bachelor of < Answer >
Science degrees. They had a common purpose, they had set performance standards for themselves and they had an
approach to hold themselves mutually accountable. They can be referred to as a
(a) Group
(b) Alliance
(c) Federation
(d) Team
(e) Co-operation.
47. A team consists of a set of people working together towards a common purpose. In an organization, there can be < Answer >
different types of teams. A work team comprised of experts from various specialties is most accurately referred to as
(a) A functional team
(b) A cross-functional team
(c) An informal group
(d) A self-managed team
(e) A self-directed team.
48. Blake and Mouton used the Managerial Grid as a framework to help managers learn what their leadership style is and < Answer >
to track their movement toward the ideal management style. According to them, the most effective leadership style is
(a) Country club management style
(b) Team management style
(c) Impoverished management style
(d) Authority obedience management style
(e) Organization man management style.
49. The process of determining the tasks that make up a job and the skills, abilities and responsibilities an employee needs < Answer >
to accomplish that job is known as
(a) Job description
(b) Job analysis 7
 (b) Job analysis
(c) Skills inventory
(d) Job specification
(e) Human resource inventory.
50. Andrew Carnegie said, "As I grow older, I pay less attention to what men say. I just watch what they do." He was < Answer >
suggesting the importance of
(a) Face-to-face verbal communication
(b) Non-verbal communication
(c) Cross-cultural communication
(d) Upward communication
(e) Downward communication.
51. Which of the following statements about assessment development centers is/are true? < Answer >

I. It comprises appraisal of an employee by a high powered panel.

II. Evaluation is subjective.
III. It identifies internal employees having the potential to carry the business forward.
IV. Though this process senior management talent is identified and nurtured so that they can train junior employees.
(a) Only (I) above
(b) Both (I) and (III) above
(c) Both (II) and (IV) above
(d) (II), (III) and (IV) above
(e) All (I), (II), (III) and (IV) above.
52. Which of the following is an approach to systematic job analysis? < Answer >

(a) Job design

(b) Job enlargement
(c) Position analysis questionnaire
(d) Job description analysis
(e) Graphic rating scale.
53. In internal recruitment a disadvantage is that when an employee is promoted to another job, it becomes essential to < Answer >
find someone to fill his/her position in the organization. This is referred to as
(a) Ripple effect
(b) Domino effect
(c) Replacement planning
(d) Extinction
(e) Halo effect.
54. Debt management ratio shows < Answer >

(a) Excess of current assets over current liabilities

(b) Number of times the value of fixed assets covers the amount of loan
(c) What percentage of the organization’s assets is financed by creditors
(d) Effective utilization of assets
(e) Ability of an organization to meet short-term obligations.
55. When a junior employee responds to his manager after interpreting the message received from the manager and < Answer >
simultaneously ensures that he understands the message correctly, which element of the communication process is in
play?
(a) Selective perception
(b) Feedback
(c) Semantics
(d) Grapevine
(e) Downward communication.
56. Which of the following statements is/are true about Douglas McGregor’s Theory X and Theory Y? < Answer >

I. Theory Y assumes that above all people want security.

II. Theory X assumes that people have little ambition.
III. Theory X assumes that the complete utilization of the intellectual potential of the average person does not take
place under the conditions of modern industrial life.
IV. Theory Y assumes that commitment towards achievement of goals is proportionate to the size of rewards
attained.
(a) Only (IV) above
(b) Both (I) and (III) above
(c) Both (II) and (IV) above
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 (c) Both (II) and (IV) above
(d) (II), (III) and (IV) above
(e) All (I), (II), (III) and (IV) above.
57. There can be various types of controls in an organization. Which of the following is a self-regulating control system < Answer >
that once put into operation, can automatically monitor the situation?
(a) Strategic control system
(b) Tactical control system
(c) Operational control system
(d) Cybernetic control system
(e) Noncybernetic control system.
58. There various external sources for obtaining job candidates. As a source for potential job candidates, which of the < Answer >
following generates the best referrals considering that a good referral reflects on the source of the recommendation?
(a) Advertisements
(b) The Internet
(c) Employee referrals
(d) Public employment agencies
(e) Outside consultants.
59. Listening is one of the most essential ingredients of effective communication. No message can be properly understood < Answer >
without intent listening. Which of the following is not an effective listening technique?
(a) Avoiding premature evaluation
(b) Avoiding eye contact
(c) Exhibiting affirmative nods and appropriate facial gestures
(d) Finding an area of interest in what the other person is saying
(e) Judging the content of the message, but not the weakness of the speaker.
60. Managers often have to choose the best alternative from a given set of alternatives. What is the technique that < Answer >
managers use for selecting an optimum combination of factors from a series of interrelated alternatives?
(a) Economic order quantity
(b) Linear programming
(c) JIT system
(d) Kanban
(e) Distribution logistics.
61. Some managers allow their personal likes and dislikes distort the ratings they give to their subordinates. This is < Answer >
known as
(a) Shifting standards
(b) Rater bias
(c) Different rater patterns
(d) The Halo effect
(e) Indirect assessment.
62. Which of the following theories states that an individual tends to act in a certain way, with the expectation that the act < Answer >
will be followed by a given outcome, and according to the attractiveness of the outcome?
(a) Vroom’s expectancy theory
(b) Adam's equity theory
(c) Herzberg’s motivation-hygiene theory
(d) McClelland's three-needs theory
(e) Maslow’s need hierarchy theory.
63. In order to manage their businesses effectively, successful global management requires < Answer >

(a) Rigid application of home-country practices

(b) Biasness towards home-country managers
(c) Recruitment of people mainly from the home country
(d) Enhanced sensitivity to differences in national customs and practices
(e) Ignoring the differences in cultural values across various countries.
64. To encourage formal organizational communication, managers should < Answer >

I. Support the flow of clear and concise statements through formal channels.
II. Ensure free access to formal channels for all organization members.
III. Assign specific communication responsibilities to staff personnel.
IV. Restrict the use of formal channels.
(a) Only (I) above
(b) Only (II) above
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 (b) Only (II) above
(c) Both (I) and (II) above
(d) Both (III) and (IV) above
(e) (I), (II) and (III) above.
65. Ketan has just been asked to type up a report in two days using a software program he has never seen before. < Answer >
Furthermore, fifteen graphs, bar charts, and pie charts are an integral part of the report. He will have to use a color
printer in a different department because their department does not have one. Ketan wonders if he will be able to get
his project accomplished on time and in the format wanted by his manager. This is an example of which variable in
Vroom's expectancy theory?
(a) Effort-performance linkage
(b) Performance-reward linkage
(c) Effort-reward linkage
(d) Attractiveness
(e) Valence.
66. The collection of positive feelings, attitudes and beliefs that an individual has about his or her current job can be < Answer >
referred to as
(a) Organization change
(b) Job satisfaction
(c) Internal locus control
(d) Organizational commitment
(e) Job sharing.
67. Which of the following refers to an organization’s ability to convert its assets into cash to meet current financial < Answer >
needs?
(a) Liquidity
(b) Equity
(c) Debt
(d) Profitability
(e) Net worth.
68. Information that originates outside the organization is known as external information. Which of the following is an < Answer >
example of external information in an organization?
(a) Daily receipts and expenditures
(b) Salesperson Quotas
(c) Descriptions of customer satisfaction with products and services
(d) Quantity of an item in hand or in inventory
(e) Cost and selling price of the company’s item.
69. Evaluation of the effectiveness and efficiency of various systems within an organization is referred to as < Answer >

(a) Budgeting
(b) Activity-based costing
(c) Quality control
(d) Management audit
(e) Transfer pricing.
70. Which of the following is not an effective way to reduce resistance to change? < Answer >

(a) Make definitive changes

(b) Set the stage for change
(c) Promote real understanding
(d) Avoid surprises
(e) Involve individuals who will be affected by a change, in planning and implementing it.
71. Which of the following is/are postulate(s) of the path - goal theory? < Answer >

I. Expectancy theory is the foundation of the path-goal concept.

II. The behavior of the leader is motivational irrespective of the environment of the subordinates.
III. The leader sets clear and specific goals for subordinates.
IV. The leader suitably rewards its employees as per their performance.
(a) Only (I) above
(b) Both (I) and (III) above
(c) Both (II) and (IV) above
(d) (I), (III) and (IV) above
(e) All (I), (II), (III) and (IV) above.

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72. McClelland highlighted the importance of three basic needs namely need for achievement, need for affiliation and < Answer >
need for power. Which of the following is/are characteristic(s) exhibited by power-motivated people?
I. They have an intense desire for success and seek competitive situations.
II. They are willing to assert themselves when a decision needs to be made.
III. The Power motive has significant implications for the organization.
IV. They have the desire to be influential.
(a) Only (IV) above
(b) Both (I) and (IV) above
(c) Both (II) and (III) above
(d) (I), (II) and (III) above
(e) (II), (III) and (IV) above.
73. Which of the following is/are advantage(s) of preventive control systems? < Answer >

I. Actual output can be compared with planned output.

II. They discourage voluntary controls exercised by managers.
III. They reduce managerial burden.
IV. Greater accuracy at work.
(a) Only (IV) above
(b) Both (I) and (II) above
(c) Both (III) and (IV) above
(d) (II), (III) and (IV) above
(e) All (I), (II), (III) and (IV) above.
74. A leader who involves employees in decision-making, delegates authority, and allows the employees to have direct < Answer >
input into the final decision, with the leader serving as only one input from the group is using which style of
leadership?
(a) Democratic-participative
(b) Laissez-faire
(c) Autocratic
(d) Consultative
(e) Impoverished.
75. In the operations research methodology, which of the following steps precedes the others? < Answer >

(a) Testing the model

(b) Deriving a solution from the model
(c) Putting the solution into effect
(d) Mathematical model construction
(e) Providing controls for the model.
76. Which of the following is not a characteristic of operations research? < Answer >

(a) It ensures long-term commitment to improvement of overall organizational quality

(b) It uses models to present problems
(c) The model, variables, constraints and goals are presented in mathematical terms
(d) It quantifies the variables in a problem as far as possible
(e) It focuses on setting goals and development of effective measures to assess the solution’s applicability in
solving the problem.
77. Skills inventory is a means of assessing internal labor supply. Which of the following does not pertain to skills < Answer >
inventory while assessing internal labor supply?
(a) Employee skill
(b) Employee interest
(c) Employee turnover
(d) Employee performance
(e) Employee knowledge.
78. In the Japanese management style, the management function of leading is characterized by < Answer >

I. Leader acting as a decision-maker and head of the group.

II. Paternalistic style of management.
III. Common values.
IV. Face-to-face confrontation; emphasis on clarity.
V. Bottom-up communication.
(a) (I), (II) and (III) above
11
 (b) (I), (III) and (IV) above
(c) (I), (IV) and (V) above
(d) (II), (III) and (V) above
(e) (II), (IV) and (V) above.
79. Raymond E. Miles proposed three models of management – The Traditional Model, The Human Relations Model and < Answer >
the Human Resources Model. Which of the following is/are ‘policies’ of the ‘Human Resources Model’?
I. The manager’s basic task is to make each worker feel useful and important.
II. The manager must create an environment in which all members may contribute to the limits of their abilities.
III. The manager must help in broadening subordinate self-direction and control.
IV. The manager must break down tasks into simple, repetitive, easily learnt operations.
(a) Only (I) above
(b) Both (I) and (IV) above
(c) Both (II) and (III) above
(d) Both (III) and (IV) above
(e) (II), (III) and (IV) above.
80. Which of the following is not a type of information system? < Answer >

(a) Transaction processing system

(b) Office automation system
(c) Management information system
(d) Decision support system
(e) Customer support system.
81. Organizations that have a divisional structure may adopt which of the following types of responsibility centers? < Answer >

(a) Profit
(b) Investment
(c) Cost
(d) Revenue
(e) Expense.
82. Which of the following is the first step in the control process? < Answer >

(a) Comparing performance against standards

(b) Measuring performance
(c) Setting performance standards
(d) Determining deviations
(e) Taking corrective action.
83 Which one of the fallowing is not a technique of financial control? < Answer >

(a) Budgetary control

(b) Quality circle
(c) Break-even analysis
(d) Responsibility accounting
(e) Internal audit.
84. Human resource planning consists of resource demand forecasting and resource supply forecasting. Which of the < Answer >
following is not a long range factor in ‘resource demand forecasting’?
(a) Demographics
(b) Relocations/plant closings
(c) Economy
(d) Technological trends
(e) Social trends.
85. Which of the following are functions of distributed leadership? < Answer >

I. The powers and functions of a leader are shared.

II. With proper training and support, individuals have the potential to lead.
III. Leadership is a process.
IV. Leadership is person-centered rather then organization-centered.
(a) Both (I) and (II) above
(b) Both (III) and (IV) above
(c) (I), (II) and (III) above
(d) (I), (II) and (IV) above
(e) All (I), (II), (III) and (IV) above.
86. Capacity decisions are one of the key decisions included in an operations management program. Which of the < Answer >
following would most likely happen, if a company was operating with insufficient capacity?
12
 (a) The company would have generally low production costs
(b) The company would be able to minimize operating costs
(c) The company would have a loss of sales and lower profits
(d) The company would be able to maximize profits
(e) The company would be able to gain market share.
87. All of the following differentiate charismatic leaders from non-charismatic leaders except < Answer >

(a) Divine grace

(b) Oratory skills
(c) Consistency and focus
(d) Behavior that is mediocre
(e) Ability to respond to crisis.
88. Which of the following costs decreases with an increase in inventory? < Answer >

(a) Cost of capital

(b) Storage space costs
(c) Obsolescence costs
(d) Ordering costs
(e) Insurance.
89. Which of the following is not a corrective action resulting from the performance appraisal system? < Answer >

(a) Job performance

(b) Incentives
(c) Training
(d) Penalties
(e) Termination.
90. Which of the following is/are proposition(s) for making controlling successful? < Answer >

I. Managers should make sure the mechanics of the control process are understood by organization members
involved in controlling.
II. Managers should use control activities to achieve many different kinds of goals.
III. Managers should ensure that control activities are supported by most organization members.
IV. Managers should make sure that the information on which corrective action is based is timely.
(a) Only (I) above
(b) Both (I) and (II) above
(c) Both (III) and (IV) above
(d) (I), (II) and (IV) above
(e) All (I), (II), (III) and (IV) above.
91. What is the correct sequence of the following steps in the ‘Career Strategy Formulation’ process? < Answer >

I. Analysis of environment threats and opportunities.

II. Development of long-range personal and professional goals.
III. Development of strategic career alternatives.
IV. Preparation of personal profile.
V. Monitoring progress.
(a) (I), (II), (IV), (III) and (V)
(b) (I), (II), (IV), (V) and (III)
(c) (IV), (I), (II), (V) and (III)
(d) (II), (III), (I), (V) and (IV)
(e) (IV), (II), (I), (III) and (V).
92. For information to be useful to managers, it must possess certain attributes. The attribute which refers to information < Answer >
as being broad or narrow in coverage of an area of interest is known as
(a) Information relevance
(b) Information completeness
(c) Information accuracy
(d) Information origin
(e) Information scope.
93. Which of the following elements at the workplace would constitute ‘esteem needs’? < Answer >

I. Promotion.
II. Opportunity to handle challenging projects.
III. Teamwork.

13
 IV. Lunch breaks.
V. Pay hike.

(a) Both (I) and (V) above

(b) Both (II) and (III) above
(c) (I), (II) and (V) above
(d) (II), (III) and (IV) above
(e) (III), (IV) and (V) above.
94 Which of the following appraises an organization's position and helps it determine where it is, where it is heading < Answer >
with its current plans and programs, whether it is meeting its objectives, and whether any revision of plans is required
to enable the organization to achieve its predefined goals and objectives?
(a) Management audit
(b) Social audit
(c) Enterprise self-audit
(d) Ethical audit
(e) Operational audit.
95. Which of the following represents the structure of work such that performance and worker satisfaction are < Answer >
maximized?
(a) Job design
(b) Job rotation
(c) Job enlargement
(d) Job enrichment
(e) Job sharing.
96. Innovation may take place in the event of all of the following situations except < Answer >

(a) An unexpected event or a failure

(b) Realization of incongruity between what is assumed and what the real situation is
(c) Change in leadership
(d) Market changes
(e) Demographic changes.
97. Supervisor's rating of individual employees on characteristics using typically a five grade system is called < Answer >

(a) Formal appraisal

(b) Informal appraisal
(c) BARS
(d) Graphic rating scale
(e) 360-degree appraisal.
98. Which of the following statements is/are true with regard to ‘Decision Support Systems (DSS)’? < Answer >

I. It is characterized by rapid response times.

II. It deploys easy-to-use software and interactive processing.
III. It uses information generated by executive information systems.
IV. It replaces a manager’s judgement.
(a) Only (II) above
(b) Both (I) and (II) above
(c) Both (III) and (IV) above
(d) (I), (II) and (III) above
(e) All (I), (II), (III) and (IV) above.
99. General Manager (Marketing) of Sumit Ltd., who monitors fortnightly achievements of each manager and gives < Answer >
instructions for better results in marketing, is acting in terms of which function?
(a) Planning
(b) Auditing
(c) Controlling
(d) Leading
(e) Organizing.
100. Which of the following can be measured by using a graphic rating scale? < Answer >

I. Quantity of work.
II. Quality of work.
III. Attendance.
IV. Dependability.
14
(a) Only (II) above
(b) Both (I) and (III) above
(c) Both (II) and (IV) above
(d) (I), (II) and (IV) above
(e) All (I), (II), (III) and (IV) above.

15
 Suggested Answers
Introduction to Management - II (MB112) : October 2006
1. Answer : (a) < TOP >

Reason : Lower rates of turnover and absenteeism are true about organizationally committed and satisfied
employees.
2. Answer : (d) < TOP >

Reason : When a manager asks his assistant manager to provide feedback about the job performance of the
individual subordinate working under him in writing, it is called performance appraisal.
3. Answer : (d) < TOP >

Reason : An organizations choice of responsibility centers depends to a great extent on the structure of the
organization and not on its control mechanisms. Hence, statement (I) is not true. Statements (II), (III)
and (IV) are true about responsibility centers. Hence, option (d) is the answer.
4. Answer : (c) < TOP >
Reason : MIS (Management Information System) can be defined as an integrated, user-machine system for
providing information to support managerial, operational and decision-making functions in an
organization. The first necessary step to effectively operate an MIS is determining information needs.
5. Answer : (d) < TOP >

Reason : Hersey and Blanchard’s model proposes that a leader should adjust his or her leadership style in
accordance with the readiness of followers.
6. Answer : (e) < TOP >

Reason : Job analysis is the process of determining the tasks that make up a job and the skills, abilities and
responsibilities an employee needs to accomplish that job. Therefore, job analysis is not a
motivational technique, while all others are techniques of motivation.
7. Answer : (a) < TOP >

Reason : When a manager interviews a job candidate by asking him a list of questions from an outline, it is an
example of a structured interview. In this, the interviewee has a predetermined set of questions that
are asked in sequence with virtually no deviations. (b) A stress interview relies on a series of harsh
rapid-fire questions that are indeed to upset the applicant and show how the applicant handles stress.
(c) Unstructured interviews are informal and unorganized. (d) A Comprehensive interview is an in-
depth selection interview which is designed to find out more about the applicant as an individual, and
in general, obtain information of interest to the interviewer so that the suitability of the candidate for
the job and the organization can be determined. (e) Semi-structured interview is a combination of
structured and unstructured interviews.
8. Answer : (d) < TOP >

Reason : Process Consultation intervention technique is concerned with the interpersonal relations and
dynamics operating in work groups. Hence, from above discussion, we can infer that option (d) is
correct.
9. Answer : (c) < TOP >

Reason : In the geocentric orientation toward international business, a firm analyzes the needs of customers
worldwide and then adopts standardized practices for all the markets it serves.
10. Answer : (a) < TOP >
Reason : A leader shows high relationship behavior and high task behavior when
I. Eventually, employees learn to perform their tasks.
II. Employees still need to be guided by leaders.
11. Answer : (c) < TOP >

Reason : All the given statements about equity theory are true except the statement that perception of fairness
depends on the behavior and treatment a superior emits towards an employee.
12. Answer : (d) < TOP >

Reason : An example of an internal force for change is workforce. Hence, from above discussion, we can infer
that option (d) is correct. Options (a), (b), (c) and (e) are all incorrect as they are all external forces

16
 for change.
13. Answer : (e) < TOP >

Reason : The following statements are true with respect to ‘discretionary expense centers’:
I. The output of a discretionary expense center cannot be directly used to produce revenues.
II. Budgets for discretionary expense centers are developed only in terms of maximum resources
that can be consumed by them in a particular period.
III. For assessing the budgetary performance, the expense constraints are established at the
discretion of the manager.
14. Answer : (b) < TOP >

Reason : Informal organizations that yield considerable power in formal organizations are referred to as
habatsu.
15. Answer : (d) < TOP >

Reason : Trade payables are a current liability and not a current asset.
16. Answer : (c) < TOP >

Reason : Manager Inventory Chart is a partial organization chart that shows managerial positions, current
incumbents, potential replacements for each position, and the age of each person. However, it does
not show the position to which a manager may be promoted. Hence from above discussion, we can
infer that option (c) is not an advantage of Manager Inventory Chart. Options (a), (b), (d) and (e) are
all advantages of Manager Inventory Chart.
17. Answer : (c) < TOP >

Reason : According to Maslow, a person who is looking for affection, belongingness, acceptance, and
friendship is said to be having a social need.
18. Answer : (a) < TOP >

Reason: The sequence of the phases in the managerial creative process is (III) unconscious scanning, (II)
intuition, (I) insight and (IV) logical formulation. Hence, option (a) is the answer.
19. Answer : (d) < TOP >

Reason : Liquidity ratios measure the ability of an organization to meet its short-term obligations by using its
current assets.
20. Answer : (c) < TOP >

Reason : In US Management style, organizing process usually involves (I) Individual responsibility and
accountability, (II) Clear and specific decision responsibility and (V) Formal, bureaucratic
organization structure.
21. Answer : (a) < TOP >
Reason : According to Fiedler, the least-preferred coworker questionnaire measures whether a person is task-
oriented or relationship-oriented.
22. Answer : (a) < TOP >

Reason : The basic elements of interpersonal communication are source/encoder, signal, and
decoder/destination.
23. Answer : (d) < TOP >

Reason : According to Herzberg and his associates job content factors which cause satisfaction are known as
motivators and job context factor that cause dissatisfaction Hygene factors. (d) is the correct answer.
24. Answer : (d) < TOP >

Reason : The following statements is/are true about ‘economic order quantity (EOQ)’:
I. It is helpful for determining desirable inventory levels when demand is predictable.
III. Decisions based on EOQ could lead to shortage or excess of inventory.
Statement (II) is not true as EOQ may not be useful in determining inventory levels of parts and
materials used in production.
25. Answer : (c) < TOP >

Reason : ‘An autocratic leader will always have low performance from employees’, is not a true statement
about autocratic leadership. An autocratic leader may have high performance too from employees.
26. Answer : (d) < TOP >

17
 Reason : In a PERT network, the sequence of events and activities requiring the longest period of time
complete is called the critical path.
27. Answer : (b) < TOP >

Reason : Having ISO 9001 certification is not a pre-requisite to adopt a Just-In-Time (JIT) system. Hence, from
above discussion, we can infer that option (b) is correct. Options (a), (c), (d) and (e) are all
characteristics of Just-In-Time (JIT) system.
28. Answer : (b) < TOP >

Reason : Activity rations when high increases an organization’s profitability resulting in a lesser need for
investment in assets.
29. Answer : (b) < TOP >

Reason : Manipulation strategy of overcoming resistance to change, usually involves selectively providing
information about a change so that it appears more attractive or necessary to potential resisters.
30. Answer : (d) < TOP >

Reason : Behaviorally Anchored Rating Scales (BARS) is a sophisticated and useful rating method. BARS
contain sets of specific behaviors that represent gradations of performance used as common reference
points (anchors). (d) is correct answer.
31. Answer : (b) < TOP >

Reason : Statement (II) is false as drives are directed at fulfillment of needs.

32. Answer : (b) < TOP >

Reason : The labor productivity index is also referred to as output per work-hour ratio.
33. Answer : (d) < TOP >

Reason : Managers must develop methods of measurement to signal when deviations from standards are
occurring so that corrective action can be taken.
34. Answer : (d) < TOP >

Reason : The following can be used in training high-potential employees to become effective leaders:
I. 360 degree feedback.
II. Organization culture workshops.
IV. Community empathy.
35. Answer : (d) < TOP >

Reason : The following points pertains to synectics:

I. The leader of the group plays a key role.
II. Members are involved in a complex set of interactions that give rise to a solution.
IV. The leader guides the discussion without revealing the problem so that members are prevented
from reaching a premature solution.
Statement (III) – the emphasis is on generating as many ideas as possible – pertains to brainstorming..
36. Answer : (e) < TOP >

Reason : People who work in multinational corporations are generally categorized as

I. Expatriates.
II. Third country nationals.
III. Host country nationals.
37. Answer : (c) < TOP >
Reason : The stage of Kurt Lewin's change model, which involves preparing employees to accept change is
unfreezing
38. Answer : (b) < TOP >

Reason : The following statements are true about ‘supportive leadership’:

I. It involves creating a pleasant organizational climate.
III. It shows concern for subordinates.
Instrumental leadership involves providing clear guidelines to subordinates. Hence, statement (II) is
not true.
Supportive leadership corresponds to relationship-oriented leadership described in other leadership
18
 theories. Instrumental leadership corresponds to task-centered leadership described in other
leadership theories.
39. Answer : (c) < TOP >

Reason : Operations Management oversees the transformation process that converts resources such as labor
and raw materials into finished goods and services.
40. Answer : (a) < TOP >

Reason : Hazard analysis involves identification of preventive measures the manufacturing units can adopt, to
control food safety hazards that arise during processing.
41. Answer : (d) < TOP >

Reason : Policies, procedures, and budgets are examples of feedforward control. Quality inspections are
examples of concurrent controls and balance sheets are examples of feedback controls.
42. Answer : (d) < TOP >

Reason : The following are inferences drawn from the Ohio State studies:
I. The dimension ‘initiating structure’ identified by Ohio State studies is similar to the job
centered leader behavior identified by Iowa studies.
II. ‘Consideration’ in Ohio studies emphasizes people related issues.
IV. The two-dimensional approach led to the probability that a leader might place emphasis on
both task and people related issues.
Statement (III) is not an inference as Ohio State studies consider initiating structure and consideration
as independent behaviors and not two ends of the same continuum.
43. Answer : (b) < TOP >

Reason : Job enlargement is a job design approach that involves the allocation of a wider variety of similar
tasks to a job in order to make it more challenging.
44. Answer : (d) < TOP >

Reason : Forces/traits within the manager that determine effective leadership behavior include his/her
I. Values.
II. Confidence in subordinates.
IV. Aggressiveness.
45. Answer : (a) < TOP >

Reason : A transaction processing system uses events as inputs and gives outputs in the forms of detailed
reports and lists.
46. Answer : (d) < TOP >

Reason : A team has a common purpose and long-term existence and has an approach to hold themselves
mutually accountable. Any congregation of individuals is called a group. An alliance is a relatively
temporary group of persons. A federation is one which the constituents (members) act independently,
though bound by a common goal. Cooperation is extending help to other members of a group.
47. Answer : (b) < TOP >

Reason : A work team comprised of experts from various specialties is most accurately referred to as a cross-
functional team. Hence, from above discussion, we can infer that option (b) is correct.
48. Answer : (b) < TOP >

Reason : According to Blake and Mouton, the most effective leadership style is Team management style.
'Team Managers' believe that concern for people and tasks are compatible and that tasks need to be
carefully explained and decisions endorsed by subordinates to achieve a high level of commitment.
Hence, from above discussion, we can infer that option (b) is correct.
49. Answer : (b) < TOP >
Reason : Job analysis is the process of determining the tasks that make up a job and the skills, abilities and
responsibilities an employee needs to accomplish that job. Hence, from above discussion, we can
infer that option (b) is correct.
50. Answer : (b) < TOP >

Reason : Non-verbal communication includes body posture, eye contact, distance from the receiver, voice
inflection, rate of speech, gesture, silence etc.

19
51. Answer : (b) < TOP >

Reason : The following statements about assessment development centers (ADC)are true:
I. It comprises appraisal of an employee by a high powered panel.
III. It identifies internal employees having the potential to carry the business forward.
Statement (II) is not true as evaluation in ADC is objective.
Statement (IV) is not true as in this process junior talent is identified and nurtured to take them to
higher managerial responsibilities.
52. Answer : (c) < TOP >

Reason : Position analysis questionnaire is an approach to systematic job analysis.

53. Answer : (a) < TOP >

Reason : When an employee is promoted to another job, it becomes essential to find someone to fill his/her
position in the organization. This is referred to as the ripple effect.
54. Answer : (c) < TOP >

Reason: Debt management ratio shows what percentage of the organization’s assets is financed by
creditors.

55. Answer : (b) < TOP >

Reason : A message that is generated by the receiver in response to the sender’s original message is known as
feedback. So, (b) is correct answer.
56. Answer : (c) < TOP >

Reason : The following statements are true about Douglas McGregor’s Theory X and Theory Y:
II. Theory X assumes that people have little ambition.
IV. Theory Y assumes that commitment towards achievement of goals is proportionate to the size
of rewards attained.
Statement (I)-All people want security is true of Theory X and statement (III) complete utilization of
the intellectual potential of the average person does not take place under the conditions of modern
industrial life is an assumption of theory Y. Hence, option (c) is the answer.
57. Answer : (d) < TOP >

Reason : Cybernetic control system is a self-regulating control system that once put into operation, can
automatically monitor the situation. All other control systems may rely on human discretion. So, (d)
is the correct answer.
58. Answer : (c) < TOP >

Reason : As a source of potential job candidates, employee referrals generate the best referrals, because
employees can provide information on the applicant’s ability to perform on the job and how well he
or she can get along with others. Hence from above discussion, we can infer that option (c) is correct.
59. Answer : (b) < TOP >

Reason : Avoiding eye contact is not an effective listening technique. Effective listening requires eye contact.
Hence, from above discussion, we can infer that option (b) is not an effective listening technique.
Options (a), (c), (d) and (e) are all effective listening techniques.
60. Answer : (b) < TOP >

Reason : Linear programming is a technique for selecting an optimum combination of factors from a series of
interrelated alternatives, each subject to limitations, to achieve a desired goal.
61. Answer : (b) < TOP >

Reason : Some managers allow their personal likes and dislikes to distort the ratings they give to subordinates.
This is called Rater bias.
62. Answer : (a) < TOP >

Reason : Vroom’s expectancy theory assumes that an individual tends to act in a certain way, with the
expectation that the act will be followed by a given outcome and according to the attractiveness of the
outcome.
63. Answer : (d) < TOP >

Reason : Successful global management requires enhanced sensitivity to differences in national customs and

20
 practices.
64. Answer : (e) < TOP >

Reason : To encourage formal organizational communication, managers should support the flow of clear and
concise statements through formal channels, ensure free access to formal channels for all organization
members, and assign specific communication responsibilities to staff personnel.
65. Answer : (a) < TOP >

Reason : The given example explains the effort-performance linkage of Vroom’s theory.
66. Answer : (b) < TOP >

Reason : Complete understanding the nature of job and expected level of performance and achieving/reaching
peak level performance gives job satisfaction.
67. Answer : (a) < TOP >

Reason : Liquidity refers to an organization’s ability to convert its assets into cash to meet current financial
needs.
68. Answer : (c) < TOP >

Reason : Descriptions of customer satisfaction with products and services are examples of external information
in an organization.
69. Answer : (d) < TOP >

Reason : Functioning of various systems in an organization can be better understood by conducting

management audits. The management audit encompass verification functioning various systems in an
organization. (d) is correct answer.
70. Answer : (a) < TOP >

Reason : Making definitive changes is not an effective way to reduce resistance to change. Hence, from above
discussion, we can infer that option (a) is correct. Options (b), (c), (d) and (e) are all effective ways to
reduce resistance to change.
71. Answer : (d) < TOP >

Reason : The following are the postulates of the path – goal theory - I. Expectancy theory is the foundation of
the path-goal concept. III. The leader sets clear and specific goals for subordinates. IV. The leader
suitably rewards its employees as per their performance. The behavior of the leader is motivational to
the extent that such behavior compliments the environment of the subordinates. Therefore, statement
(II) is incorrect and option (d) is the answer.
72. Answer : (e) < TOP >

Reason : The following are characteristics exhibited by power-motivated people:

II. They are willing to assert themselves when a decision needs to be made.
III. The Power motive has significant implications for the organization.
IV. They have the desire to be influential.
Achievement oriented people have an intense desire for success and seek competitive situations.
Hence, statement (I) is not true.
73. Answer : (c) < TOP >

Reason : The following are advantages of preventive control systems:

III. They reduce managerial burden.
IV. Greater accuracy at work.
Actual output can be compared with planned output in direct control. Hence, statement (I) is not true.
Preventive controls encourage voluntary or self control controls exercised by managers and this
increases managerial responsibility. Hence, statement (II) is not true.
74. Answer : (a) < TOP >

Reason : A democratic-participative leader involves employees in decision-making, delegates authority, and

allows the employees to have direct input into the final decision, with the leader serving as only one
input from the group.
75. Answer : (d) < TOP >

Reason : In the operations research methodology, mathematical model construction precedes the other steps.

21
76. Answer : (a) < TOP >

Reason : Ensuring long-term commitment to improvement of overall organizational quality is a characteristic

of total quality management.
77. Answer : (c) < TOP >

Reason : A skills inventory is a computerized database consisting of information regarding an employee, his
skills, experience, interests, performance and other relevant personal characteristics. However, skills
inventory does not provide any information about employee turnover.
78. Answer : (d) < TOP >

Reason : In the Japanese management style, the management function of leading is characterized by
II. Paternalistic style of management.
III. Common values.
V. Bottom-up communication.
In Japanese management the leader acts as a social facilitator and group member. Hence, statement (I)
is not characteristic of Japanese management.
In Japanese management, confrontation is avoided; emphasis is on harmony. Hence, statement (IV) is
also not a characteristic.
Both statements (I) and (IV) are characteristics of the US style of management.
79. Answer : (c) < TOP >

Reason : The following are ‘policies’ of the ‘human resources model’:

II. The manager must create an environment in which all members may contribute to the limits of
their abilities.
III. The manager must help in broadening subordinate self-direction and control.
Statement (I) - the manager’s basic task is to make each worker feel useful and important is a policy
of the human relations model.
Statement (IV) – the manager must break down tasks into simple, repetitive, easily learnt operations is
a policy of the traditional model.
80. Answer : (e) < TOP >

Reason : Customer support system is not a type of information system

81. Answer : (a) < TOP >
Reason : Organizations that have a divisional structure may adopt a profit center because the large divisions in
these organizations generally have control over both revenues and expenses associated with profits.
82. Answer : (c) < TOP >

Reason : Controlling is the task of evaluating the performance and taking corrective actions to accomplish
organizational objectives in accordance with predetermined ones. For this the first step is setting
performance standards. So, (c) is the correct answer.
83. Answer : (b) < TOP >

Reason : Financial control is relevant for those aspects of business operations whose outcomes are expressed in
monetary terms. The major techniques of financial control at operative level are budgetary control,
break-even analysis, Responsibility accounting and internal audit. Quality circle is not a technique of
financial control and it is a technique of operating control.
84. Answer : (b) < TOP >

Reason : Relocations/plant closings constitute a short range factor in resource demand forecasting. Hence,
option (b) is the answer.
85. Answer : (c) < TOP >

Reason : The following are functions of distributed leadership:

I. The powers and functions of a leader are shared.
II. With proper training and support, individuals have the potential to lead.
III. Leadership is a process.
Leadership is organization-centered rather then person-centered. Therefore, statement (IV) is not a
function of distributed leadership.
86. Answer : (c) < TOP >

22
 Reason : The event that would be most likely to happen if a company was operating with insufficient capacity
is that the company would have a loss of sales and lower profits.
87. Answer : (d) < TOP >

Reason : “Mediocre behavior” does not characterize charismatic leadership.

88. Answer : (d) < TOP >
Reason : Ordering costs decrease with an increase in inventory. The remaining costs increase with an increase
in inventory.
89. Answer : (a) < TOP >

Reason : Job performance is an activity of the individual in a performance appraisal system and not a
corrective action resulting from an appraisal.
90. Answer : (d) < TOP >

Reason : Ensuring that control activities are supported by most organization members is not essential for
making controlling successful.
91. Answer : (e) < TOP >

Reason : The correct sequence of the steps in the ‘career strategy formulation’ process is:
IV. Preparation of personal profile.
II. Development of long-range personal and professional goals.
I. Analysis of environment threats and opportunities.
III. Development of strategic career alternatives.
V. Monitoring progress.
Hence, option (e) is the answer.
92. Answer : (e) < TOP >

Reason : Information scope refers to information as being broad or narrow in coverage of an area of interest is
known as information scope.
93. Answer : (a) < TOP >

Reason : The following elements at the workplace would constitute ‘esteem needs’:
I. Promotion.
V. Pay hike.
94. Answer : (c) < TOP >

Reason : An enterprise self-audit appraises an organization’s position and helps it determine where it is, where it
is heading with its current plans and programs, whether it is meeting its objectives, and whether any
revision of plans is required to enable the organization to achieve its predefined goals and objectives.
95. Answer : (a) < TOP >

Reason : Job design is the structure of work such that performance and worker satisfaction are maximized.
96. Answer : (c) < TOP >

Reason : Innovation may take place in the event of all the given situations except when there is a change in
leadership.
97. Answer : (d) < TOP >

Reason : Graphic rating scales use a number of factors, including general behaviors and characteristics on
which employees are rated by superior. Superiors rate individuals on each factor, using a scale that
typically has about five grades. So, (d) is correct answer.
98. Answer : (b) < TOP >

Reason : The following statements are true with regard to ‘Decision Support Systems (DSS)’:
I. It is characterized by rapid response times.
II. It deploys easy-to-use software and interactive processing.
The DSS uses information generated by transaction processing systems and office automation
systems. Hence, statement (III) is not true.
DSS supports a manager’s judgement, and does not replace it. Hence, statement (IV) is not true.
99. Answer : (c) < TOP >

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 Reason : Monitoring of work in a fixed period of time and analyzing and advising is a controlling function of
management. So, (c) is correct answer.
100. Answer : (e) < TOP >

Reason : Graphic rating scales are performance appraisal forms listing a number of factors, including general
behaviors and characteristics (such as attendance, quality of work, appearance, dependability,
quantity of work and relationship with people), on which employee is rated by the supervisor.

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